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        REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.       153      OF 2013 (Arising out of S.L.P. (C) No.9196 of 2008)

Board of Trustees of Port of Kandla …Appellant

Versus

Hargovind Jasraj & Anr. …Respondents

J U D G M E N T

T.S. THAKUR, J.

1. Leave granted.

2. This appeal arises out of a judgment and order dated  

26th December, 2007 passed by the High Court of Gujarat at  

Ahmedabad  whereby  Civil  Second  Appeal  No.17  of  2007  

filed by the appellant has been dismissed and the judgment  

and decree passed by the Courts below affirmed.  The facts  

giving rise to the filing of this appeal may be summarised as  

under:

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3. A parcel of land admeasuring 1891.64 square meters  

situated in Sector 30, Gandhidham in the State of Gujarat  

was  granted  in  favour  of  Smt.  Pushpa  Pramod  Shah-

respondent No.2 in this appeal on a long-term lease basis. A  

formal  lease-deed  was  also  executed  and  registered  in  

favour of the lessee stipulating the terms and conditions on  

which the lessee was to hold the land demised in her favour.  

The respondent-lessee it appears committed default in the  

payment of the lease rent stipulated in the lease-deed with  

the result that the appellant-lessor issued notices dated 12th  

December, 1975 and 17th July, 1976 calling upon the lessee  

to pay the outstanding amount with interest and stating that  

the  lease  of  the  plot  in  question  shall  stand  determined  

under  Clause  4  thereof  and  possession  of  the  demised  

premises taken over by the appellant-Port Trust in case the  

needful is not done.  

4. In response to the notices aforementioned the lessee  

by  communication  dated  18th November,  1976  requested  

the appellant-Port Trust to permit her to resell the plots for  

a  symbolic consideration and to obtain  the refund of the  

instalment amount already paid to the Port Trust. The letter  

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sought to justify the default in the payment of arrears on  

the ground of an untimely demise of her husband, resulting  

in  cancellation  of  expansion  programme  including  any  

further acquisition of land by the lessee.  

5. Failure  of  the  lessee  to  remit  the  outstanding  

instalment  amount  culminated  in  the  termination  of  the  

lease by the appellant-Port Trust in terms of an order dated  

8th August, 1977 w.e.f. 13th December, 1978. A panchnama  

prepared on 14th December, 1978 evidenced the takeover of  

possession  of  the  plot  in  question  by  the  appellant-Port  

Trust, copy whereof was forwarded even to the lessee along  

with a certificate that the possession had been taken over  

by the Assistant Estate Manager of the appellant-Port Trust  

under his letter dated 20th December, 1978.  

6. On receipt of the letter aforementioned the lessee by  

her  letter  dated  22nd February,  1979  requested  the  

appellant-Port  Trust  to  refund  the  amount  and  in  case  a  

refund could not be made, to return the possession of the  

plot to her. One year and four months after the issue of the  

said letter the lessee-respondent No.2 herein filed Civil Suit  

No.152 of 1980 in the Court of Civil Judge, Gandhidham, in  

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which  she  prayed  for  a  decree  for  permanent  injunction  

restraining  the  defendants,  its  officers  and  servants  from  

interfering  with  her  peaceful  possession  over  the  plot  in  

question. The immediate provocation for the filing of the said  

suit was provided by the appellant-Port Trust proposing to  

re-auction the plot in question. The plaintiff’s case in the suit  

was that she was in actual physical possession of the plot  

which rendered the proposed auction thereof unreasonable.  

An interim application was also filed in the said suit in which  

the Court granted an ex-parte order of injunction that was  

subsequently  vacated  by  a  detailed  order  passed  on  5th  

September, 1980 holding that the plaintiff was not entitled to  

the relief of injunction. It is common ground that suit No.152  

of 1980 was eventually dismissed on 18th January, 1985 for  

non-prosecution.  

7. Almost six years  after  the  dismissal of  the  first  suit,  

another  Suit  No.126  of  1991  was  filed,  this  time  by  

respondent No.1-Hargovind Jasraj against respondent No.2-

Smt.  Pushpa  Pramod  Shah  for  a  permanent  prohibitory  

injunction restraining defendant No.2-lessee of the plot, her  

agents,  servants and representatives from interfering with  

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the plaintiff’s possession over the plot in dispute. According  

to averments made in the said suit the lessee had not been  

carrying on any business activities in Gandhidham nor was  

she using the plot in question and that she was finding it  

difficult to look after and administer the plot after the death  

of  her  husband.  She  had,  therefore,  sold the  plot  to  the  

plaintiff-respondent  No.1  in  this  appeal  in  terms  of  a  

registered document. It was further alleged that the cause of  

action to file the suit accrued a few days before the filing of  

the  suit  when  defendant-lessee  had  through  her  

representative  asked  the  plaintiff  to  vacate  the  suit  plot  

which demand was in breach of the sale agreement between  

the  parties.  Apprehending  dispossession  from  the  plot  in  

question  plaintiff-respondent  No.1  sought  a  decree  for  

injunction against respondent No.2. The appellant-Port Trust,  

it is noteworthy, was not impleaded as a party to the suit  

which too was dismissed for non-prosecution on 15th March,  

2002.  

8. Five years later and pending disposal of the second suit  

mentioned above, a third suit being Suit No.77 of 1996 was  

filed by respondent No.1 this time asking for a declaration  

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and permanent injunction in which the plaintiff for the first  

time  questioned  the  termination  of  the  lease  by  the  

appellant-Port Trust. A declaration that the said lease was  

still subsisting with an injunction restraining the defendant-

appellant in this appeal and its employees from acting in any  

manner  injurious  to  the  title  and  the  possession  of  the  

plaintiff over the disputed land was prayed for. Plaintiff’s case  

in this suit was that he had purchased the plot in question  

from Smt. Pushpa Pramod Shah in the year 1991 in terms of  

a transfer deed registered with the concerned Sub-Registrar  

at Gandhidham and that he had based on the said transfer  

asked for transfer of the lease rights which request had been  

declined by the appellant-Port Trust in the year 1994. It was  

further  alleged  that  he  had  come  to  know  about  the  

purported cancellation of the lease in favour of Smt. Pushpa  

Pramod Shah and the purported takeover of the possession  

of  the  plot  from  her  which  was  according  to  him  both  

fraudulent and invalid in the eyes of law.   

9. The suit was contested by the appellant-Port Trust on  

several  grounds  giving  rise  to  as  many  as  seven  issues  

framed by the trial Court for determination. The suit was  

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eventually decreed by the said Court, aggrieved whereof the  

appellant-Port  Trust  filed  an  appeal  before  the  First  

Appellate Court who partly allowed the said appeal by its  

judgment  and  order  dated  16th November,  2006.  The  

Appellate Court affirmed the decree passed by the Courts  

below in  so  far  as  the  trial  Court  had  declared  that  the  

lease-deed in question had not been validly terminated by  

the  lessor  and  the  same  continued  to  be  subsisting  but  

allowed the appeal setting aside that part of the judgment  

passed  by  the  trial  Court  whereby  the  trial  Court  had  

directed the appellant-Port Trust to transfer the lease rights  

in favour of the plaintiff-respondent No.1 in this appeal.   

10. The appellant-Port  Trust  appealed to the High Court  

against  the  above  judgment  and  decree  which  has  been  

dismissed by the High Court in terms of the order impugned  

before us holding that no substantial question of law arose  

in the light of the concurrent findings of fact recorded by the  

courts below. The High Court found that since the earlier  

suits had not been decided on merits, no final adjudication  

had taken place in the same so as to attract the doctrine of  

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res judicata to the issues raised in the third suit out of which  

the present proceedings arise.

11. Appearing  for  the  appellant  Mr.  Pravin  H.  Parekh,  

learned senior counsel, strenuously argued that the courts  

below  had  fallen  in  serious  error  in  holding  that  the  

termination  of  the  lease  by  the  appellant-Port  Trust  was  

invalid  or  that  the  lease  continued  to  be  valid  and  

subsisting. The question whether the Senior Estate Manager  

was competent to terminate the lease and enter upon the  

suit property was not, argued Mr. Parekh, joined as an issue  

by the  courts  below and  could  not  be  made  a  basis  for  

holding  the  termination  to  be  unauthorised  or  invalid.  

Alternatively, he submitted that the termination order had  

been passed as early as in the year 1977 whereas the suit  

in question was filed in the year 1996 after a lapse of nearly  

18 years. The possession of the plot was also taken over on  

14th December,  1978  which  fact  was  acknowledged  

unequivocally  by  the  lessee  in  her  letter  dated  22nd  

February,  1979.  That  being  so,  any  suit  aimed  at  

challenging  the  validity  of  the  termination  or  assailing  

validity of the process by which the possession was taken  

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over from the lessee should have been filed within a period  

of six months from the date the cause of action accrued to  

the lessee in terms of Section 120 of the Major Port Trust  

Act. At any rate, such a suit could be filed, at best within  

three years from the date the cause of action accrued to the  

lessee. Neither the lessee nor her transferee who came on  

the scene long after the termination order had been passed  

and the possession taken over could question the validity of  

the termination of the lease or demand protection of their  

possession in the light of a clear and unequivocal admission  

made by the lessee in her letter dated 22nd February, 1979  

that the possession of the plot in question stood taken over  

from her. The courts below have, in that view, committed a  

mistake in holding that the suit was within time.

12. Mr. Ahmadi, counsel appearing for the respondent, on  

the  other  hand,  submitted  that  the  courts  below  had  

recorded  a  concurrent  finding  of  fact  that  the  lessee  

continued to be in possession of the suit property even after  

the termination of the lease which finding of fact could not  

be  assailed  nor  was  there  any  legal  impediment  for  the  

plaintiff transferee or the original lessee who too was joined  

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as a plaintiff in the year 1999 to seek protection of their  

possession. It was further argued by Mr. Ahmadi that the  

admission  made  by  the  lessee  in  her  letter  dated  22nd  

February, 1979 was not unequivocal and stood explained by  

the  attendant  circumstances  including  the  demise  of  her  

husband and resultant inability of the lessee to go ahead  

with the expansion programme or to pay remainder of the  

lease amount.  

13. The Trial Court has, while dealing with the question of  

dispossession of the lessee from the disputed plot, recorded  

a  rather  ambivalent  finding.  This  is  evident  from  the  

following observations made by it in its judgment:

“…..Further Panchnama submitted alongwith Ex.49  cannot be said to be panchnama of taking physical   possession of  the plot  because the plot  is  open.   Even at present it is open and there are bushes of   the Babool Trees and as such it is difficult to hold   anything  about  possession  that  of  Pushpaben  or   K.P.T.   IT  cannot  be  believed  that  by  mere  preparing  panchnama  the  possession  has  been  taken from the person who is in possession of the  plot.  The K.P.T. has not taken the possession vide  Ex. 49 in the presence of Pushpaben.  Under the  said circumstances the plot is open and it is as it   is…….”                                      

    (emphasis supplied)

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14. It  is  manifest  that  there  is  no  clear  finding  of  fact  

regarding possession of the suit property having continued  

with the lessee, no matter the lease stood terminated and a  

panchnama evidencing takeover  of  the  possession  drawn  

and even communicated to her. The first Appellate Court in  

appeal filed against the above judgment and decree also did  

not record a specific finding that the possession of the plot  

had not been taken over by the Port Trust no matter the  

documents relied upon by it evidenced such take over.  The  

first Appellate Court instead held that the termination of the  

lease  was  not  valid  inasmuch  as  no  notice  regarding  

termination  in  terms  of  Sections  106  and  111(g)  of  the  

Transfer of Property Act, 1882 had been proved and served  

upon  the  lessee  nor  was it  proved that  the  person  who  

signed notice Exhibit 47 and who took over possession in  

terms  of  panchnama enclosed  with  Exhibit  49  had  been  

authorised by the Kandla Port Trust, the lessor, to do so.  

The  conclusions  drawn by the  first  Appellate  Court  were  

summarised in paragraph 59 of its judgment in the following  

words:

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“59.  In view of what is stated in foregoing paras of   this  judgment  this  Court  come  to  the  following   conclusions: -

1. The  appellant/original  defendant  has  failed  to   prove the service of notice terminating the lease   as required under Section 111(g) and 106 of the   Transfer of Property Act upon the lessee i.e. the   Respondent No. 2/original plaintiff No. 2.

2. The  defendant/the  present  appellant  failed  to   prove that the person who signed the notice Ex.   47 and the person who is alleged to have made  re-entry  on the suit  plot and signed Ex.49 and   panchnama  produced  along  with  Ex.  49  were   specifically  authorised by Kandla  Port  Trust  i.e.   the lessor and the Chairman of Kandla Port Trust.   

3.    The lease dated 14/12/1966 is not legally and   validly  determined  by  the  lessor  hence,  it  is   subsisting till  date and alive, and the lessee Smt.   Pushapaben  Shah  i.e.  the  respondent  No.  2  is   entitled to hold and enjoy the  suit  plot  No. 30   sector No. 8.”

15. In the second appeal filed by the appellant, the High  

Court was of the view that the matter was concluded by  

concurrent  findings  of  fact  regarding  the  validity  of  the  

termination of the lease and the authority of those  who  

purported to have brought about such a termination.  The  

question whether the possession of the suit plot was taken  

over  did  not  engage  the  attention  of  the  first  Appellate  

Court or the High Court although the latter proceeded on  

the basis that the findings of fact recorded by the Courts  

below were  concurrent,  without  pointing  out  as  to  what  

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those  findings  were  and  how  the  same  put  the  issue  

regarding  takeover  of  the  possession  from  the  lessee  

beyond the pale of any challenge.  Suffice it to say that the  

respondents are not correct in urging that the dispossession  

of the lessee pursuant to the termination of the lease was  

not proved as a fact. None of the Courts below has recorded  

a clear finding on this aspect even though the trial Court  

has in its judgment briefly touched that issue but declined  

to record an affirmative finding in the matter.  That apart a  

careful  reading of  the  passage extracted  above from the  

order passed by the trial Court shows that the trial Court  

was labouring under the impression as though possession of  

the vacant piece of land cannot be taken over by the lessor  

unless some overt act of actual occupation of the plot is  

established. The fact that wild bushes were growing on the  

plot  was,  in  our  opinion,  no  reason  to  hold  that  the  

panchnama  prepared  by  the  Port  Trust  authorities  

evidencing the takeover of the plot was inconsequential or  

insufficient to establish that the process of dispossession of  

the lessee had been accomplished. We need to remember  

that with the termination of the lease, the title to the suit  

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property  vested  in  the  lessor,  ipso jure.   That  being so,  

possession of a vacant property would follow title and also  

vest in the lessor. Even so, the Panchnama drawn up at site  

recorded the factum of actual takeover of the possession  

from  the  lessee,  whereafter  the  possession  too  legally  

vested  in  the  lessor,  growth  of  wild  bushes  and  grass  

notwithstanding.  We need not delve any  further on this  

aspect for we are of the view that there could be no better  

evidence to prove that the lessee had been dispossessed  

from the plot in question than her own admission contained  

in her communication dated 22nd February, 1979 addressed  

to the Senior Estate Manager of the appellant-Trust.  The  

letter may at this stage be extracted in extenso:

“Dear Sir,

     I  am  in  receipt  of  your  letter  No.  ES/LL/723/63/9180  dated  20th December  1978  informing  that  the  Assistant  Estate  Manager  has   taken over the plot No. 30 Sector 8.  Please note,   you have not informed me to be present on 4 PM on   14.12.1978 at the site of the aforesaid plot and your   letter No. ES/LL/723/63/6248 dated 8th August 1977  said  to  have  been  sent  to  me  has  not  yet  been   received and hence you do not have the authority to   re-enter the plot.

  As you have taken the possession of the plot, you   are now requested to kindly refund all the amounts   forthwith  otherwise  you  may  return  back  the   possession of plot to me.  If I do not hear anything   from you within seven days from the date of receipt   

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of this letter, appropriate legal proceedings will  be   adopted  against  you,  holding  you  entirely   responsible for the cost of consequences thereof.

                              Yours faithfully,

                              Sd/- P.P. Shah

                         (Smt. Pushpa P. Shah)”

                                        (emphasis supplied)

16. The  genuineness  of  the  above  document  was  not  

disputed by learned counsel for the respondents.  All that  

was  argued  was  that  the  admission  regarding  the  

dispossession of the lessee had been made in circumstances  

that (a) cannot constitute an admission and (b) absolve the  

lessee, the maker, of its binding effect. The husband of the  

lessee  having  passed  away,  the  letter  in  question  was  

written in a state of shock and distress and any admission  

made therein could not argued Mr. Ahmadi and Ms. Bhati be  

treated as an admission in the true sense.  We regret our  

inability to accept that submission. The question is whether  

possession  had  indeed  been  taken  over  from the  lessee  

pursuant to the termination of the lease.  The answer to  

that question is squarely provided by the letter in which the  

lessee makes an unequivocal and unconditional admission  

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that  possession  had  indeed  been  taken  over  by  the  

appellant-Port Trust. What is significant is that the lessee  

had asked for refund of the amount paid by her towards  

instalments and in case such a refund was not possible to  

return  the  plot  to  her.  We  do  not  think  that  such  an  

unequivocal admission as is contained in the letter can be  

wished  away or  ignored  in  a  suit  where  the  question  is  

whether the lessee had indeed been dispossessed pursuant  

to  the  termination of  the  lease.   There  is  no worthwhile  

explanation or any other reason that can possibly spell a  

withdrawal  of  the  admission or  constitute  an  explanation  

cogent enough to carry conviction with the Court.  We have  

in that view no hesitation in holding that dispossession of  

the lessee had taken place pursuant to the termination of  

the  lease  deed  in  terms  of  panchnama  dated  14th  

December, 1978.

17. The  next  question  then  is  whether  the  suit  for  

declaration to the effect that the termination of the lease  

was invalid and that the lease continued to subsist could be  

filed more than 17 years after the termination had taken  

place.  A suit for declaration not covered by Article 57 of the  

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Schedule to the Limitation Act, 1963 must be filed within 3  

years  from the  date  when  the  right  to  sue  first  arises.  

Article 58 applicable to such suits reads as under:

Description of suit Period of  Limitation

Time from which  period begins to  run

58. To obtain any other  declaration.

Three years When the right to  sue first accrues.

18. The expression right to sue has not been defined.  But  

the  same  has  on  numerous  occasions  fallen  for  

interpretation before the Courts.  In  State of Punjab &  

Ors. V. Gurdev Singh (1991) 4 SCC 1, the expression  

was explained as under :

“………. The words “right to sue” ordinarily mean the right to   

seek relief by means of legal proceedings. Generally, the   right to sue accrues only when the cause of action arises,   that  is,  the right  to prosecute  to obtain  relief  by legal   means.  The  suit  must  be  instituted  when  the  right   asserted in the suit is infringed or when there is a clear   and  unequivocal  threat  to  infringe  that  right  by  the   defendant against whom the suit is instituted.”

19. Similarly in  Daya Singh & Anr.  V.  Gurdev Singh  

(dead) by LRs. & Ors. (2010) 2 SCC 194 the position  

was re-stated as follows:

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“13.  Let us, therefore, consider whether the suit was   barred by limitation in view of Article 58 of the Act in   the background of the facts stated in the plaint itself.   Part  III  of  the  Schedule  which  has  prescribed  the   period  of  limitation  relates  to  suits  concerning   declarations. Article 58 of the Act clearly says that to   obtain any other declaration, the limitation would be   three years from the date when the right to sue first   accrues.

14. In support of the contention that the suit was filed   within  the  period  of  limitation,  the  learned  Senior   Counsel appearing for the appellant-plaintiffs before us   submitted  that  there  could  be  no  right  to  sue  until   there is an accrual of the right asserted in the suit and   its  infringement  or  at  least  a  clear  and  unequivocal   threat to infringe that right by the defendant against   whom  the  suit  is  instituted.  In  support  of  this   contention the learned Senior Counsel  strongly relied   on a decision of the Privy Council  in reported in AIR   1930  PC  270  Bolo v.  Koklan.  In  this  decision  Their   Lordships of the Privy Council observed as follows:  

‘… There can be no ‘right to sue’ until there is an   accrual  of  the  right  asserted  in  the  suit  and its   infringement, or at least a clear and unequivocal   threat  to  infringe  that  right,  by  the  defendant   against whom the suit is instituted.’

15.  A  similar  view  was  reiterated  in  C.  Mohammad  Yunus v. Syed Unnissa AIR 1961 SC 808 in which this   Court observed: (AIR p.810, para 7)

‘ … The period of six years prescribed by Article   120 has to be computed from the date when the   right to sue accrues and there could be no right to   sue until there is an accrual of the right asserted   in the suit and its infringement or at least a clear   and unequivocal threat to infringe that right.’

In C. Mohammad Yunus, this Court held that the cause  of  action  for  the  purposes  of  Article  58  of  the  Act   accrues  only  when  the  right  asserted  in  the  suit  is   infringed or there is at least a clear and unequivocal   threat  to  infringe  that  right.  Therefore,  the  mere   existence of an adverse entry in the revenue records   cannot give rise to cause of action.

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……….Accordingly, we are of the view that the right to   sue accrued when a clear and unequivocal  threat  to   infringe that right by the defendants…….”

20. References may be made to the decisions of this Court  

in Khatri Hotels Pvt. Ltd. & Anr. V.  Union of India &  

Anr. (2011) 9 SCC 126 where this Court observed:

“While  enacting  Article  58  of  the  1963  Act,  the   legislature has designedly made a departure from the   language  of  Article  120  of  the  1908  Act.  The  word   “first”  has  been  used  between  the  words  “sue”  and  “accrued”. This would mean that if a suit is based on   multiple causes of action, the period of limitation will   begin to run from the date when the right to sue first   accrues.  To put  it  differently,  successive  violation  of   the right will not give rise to fresh cause and the suit   will be liable to be dismissed if it is beyond the period   of limitation counted from the day when the right to   sue first accrued.”

     (emphasis supplied)

21. The right to sue in the present case first accrued to the  

lessee  on  13th December,  1978  when  in  terms  of  order  

dated 8th August, 1977 the lease in favour of the lessee was  

terminated.  A suit for declaration that the termination of  

the  lease  was  invalid  hence  ineffective  for  any  reason  

including the reason that the person on whose orders the  

same was terminated had no authority to do so, could have  

been instituted by the lessee on 14th of December 1978.  

For any such suit it was not necessary that the lessee was  

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dispossessed from the leased property as dispossession was  

different from termination of the lease.  But even assuming  

that the right to sue did not fully accrue till the date the  

lessee  was  dispossessed  of  the  plot  in  question,  such  a  

dispossession  having  taken  place  on  14th of  December,  

1978, the lessee ought to have filed the suit within three  

years of 15th December, 1978 so as to be within the time  

stipulated under Article 58 extracted above.  The suit in the  

instant case was, however, instituted in the year 1996 i.e.  

after nearly eighteen years later and was, therefore, clearly  

barred  by  limitation.   The  Courts  below  fell  in  error  in  

holding  that  the  suit  was  within  time  and  decreeing  the  

same in whole or in part.   

22. Mr.  Ahmadi next argued that the termination of the  

lease  being  illegal  and  non  est  in  law,  the  plaintiff-

respondents could ignore the same, and so long as they or  

any  one  of  them  remained  in  possession,  a  decree  for  

injunction restraining the Port  Trust  from interfering with  

their possession could be passed by the Court competent to  

do  so.  We  are  not  impressed  by  that  submission.  The  

termination of the lease deed was by an order which the  

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plaintiffs ought to get rid of by having the same set aside,  

or  declared  invalid  for  whatever  reasons,  it  may  be  

permissible to do so. No order bears a label of its being valid  

or invalid on its forehead.  Any one affected by any such  

order  ought to seek redress against the same within the  

period permissible for doing so.  We may in this regard refer  

to the following oft quoted passage in Smith v. East Elloe  

Rural  District  Council (1956)  1  All  ER  855.  The  

following are  the  observations  regarding the  necessity  of  

recourse to the Court for getting the invalidity of an order  

established:     

“An order, even if not made in good faith is still an act   capable  of  legal  consequences.  It  bears  no brand of   invalidity  on  its     forehead.   Unless  the  necessary  proceedings are taken at law to establish the cause of   invalidity and to get it quashed or otherwise upset, it   will  remain as effective  for  its  ostensible  purpose as   the most impeccable of orders.

This  must  be  equally  true  even  where  the  brand of   invalidity is plainly visible : for there also the order can   effectively  be  resisted  in  law  only  by  obtaining  the   decision of the court. The necessity of recourse to the   court has been pointed put repeatedly in the House of   Lords  and  Privy  Council  without  distinction  between   patent and latent defects.”

23. The  above  case  was  approved  by  this  Court  in  

Krishnadevi  Malchand  Kamathia  &  Ors.  v.  Bombay  

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Environmental Action Group and Ors. (2011) 3 SCC  

363, where this Court observed:

“19. Thus, from the above it emerges that even if the   order/notification is void/voidable, the party aggrieved  by  the  same  cannot  decide  that  the  said   order/notification  is  not  binding  upon  it.  It  has  to   approach the court for seeking such declaration. The   order may be hypothetically  a nullity  and even if  its   invalidity  is  challenged  before  the  court  in  a  given   circumstance, the court may refuse to quash the same   on  various  grounds  including  the  standing  of  the   Petitioner or on the ground of delay or on the doctrine   of  waiver  or any  other  legal  reason.  The order may   be void for one purpose or for one person, it may not   be so for another purpose or another person.”

24. To  the  same  effect  is  the  decision  of  this  Court  in  

Pune Municipal Corporation v. State of Maharashtra  

and Ors (2007) 5 SCC 211, where this Court discussed  

the need for determination of invalidity of an order for public  

purposes:

“36.  It  is  well  settled  that  no  order  can  be  ignored   altogether  unless  a  finding  is  recorded  that  it  was   illegal,  void or  not  in  consonance  with  law.  As  Prof.   Wade states: "The principle must be equally true even   where  the  'brand  of  invalidity'  is  plainly  visible:  for   there also the order can effectively be resisted in law   only by obtaining the decision of the Court".

He further states:

“The  truth  of  the  matter  is  that  the  court  will   invalidate  an  order  only  if  the  right  remedy  is   sought  by  the  right  person  in  the  right   

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proceedings  and  circumstances.  The  order  may   be  hypothetically  a  nullity,  but  the  Court  may   refuse to quash it because of the plaintiff's lack of   standing,  because  he  does  not  deserve  a  discretionary remedy, because he has waived his   rights,  or  for  some  other  legal  reason.  In  any   such case the 'void' order remains effective and  is, in reality, valid. It follows that an order may   be void for  one  purpose  and  valid  for  another,   and that  it  may be void against  one person but   valid against another.”

xx xx xx xx

38. A similar question came up for consideration before   this  Court  in State  of  Punjab  and  Ors.  v.  Gurdev   Singh (1992) ILLJ 283 SC ...

39. Setting aside the decree passed by all the Courts   and referring to several cases, this Court held that if   the party aggrieved by invalidity of the order intends to   approach  the  Court  for  declaration  that  the  order   against him was inoperative, he must come before the   Court within the period prescribed by limitation. "If the  statutory time of limitation expires, the Court cannot   give the declaration sought for".”

25. Reference  may  also  be  made  to  the  decisions  of  this  

Court in  R. Thiruvirkolam v. Presiding Officer and Anr.  

(1997) 1 SCC 9, State of Kerala v. M.K. Kunhikannan  

Nambiar  Manjeri  Manikoth,  Naduvil  (dead)  and  Ors.   

(1996) 1 SCC 435 and Tayabbhai  M.  Bagasarwalla  &  

Anr.  v.  Hind Rubber Industries Pvt. Ltd. etc. (1997) 3  

SCC 443, where this Court has held that an order will remain  

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effective and lead to legal consequences unless the same is  

declared to be invalid by a competent court.

26. It is true that in some of the above cases, this Court  

was dealing with proceedings arising under Article 226 of  

the  Constitution,  exercise  of  powers  whereunder  is  

discretionary but then grant of declaratory relief under the  

Specific Relief Act is also discretionary in nature.   A Civil  

Court can and may in appropriate cases refuse a declaratory  

decree for good and valid reasons which dissuade the Court  

from  exercising  its  discretionary  jurisdiction.   Merely  

because the suit is within time is no reason for the Court to  

grant a declaration.  Suffice it to say that filing of a suit for  

declaration  was  in  the  circumstances  essential  for  the  

plaintiffs.  That is precisely why the plaintiffs brought a suit  

no matter beyond the period of limitation prescribed for the  

purpose. Such a suit was neither unnecessary nor a futility  

for  the  plaintiff’s  right  to  remain in  possession depended  

upon whether the lease was subsisting or stood terminated.  

It is not, therefore, possible to fall back upon the possessory  

rights claimed by plaintiffs over the leased area to bring the  

suit within time especially when we have, while dealing with  

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the question of possession, held that possession also was  

taken over pursuant to the order of termination of the lease  

in question.

27. In the light of what we have said above, we consider it  

unnecessary to examine the question whether the suit in  

question was barred by Section 120 of the Major Ports Act  

which stipulates a much shorter period of limitation of six  

months.  We  also  consider  it  unnecessary  to  examine  

whether the suit filed by the original plaintiff-transferee of  

the lessee was barred by the principle of  constructive res  

judicata or Order II, Rule 2 of the Code of Civil Procedure,  

1908 in view of the fact that the first suit filed by the lessee  

in the year 1980 for permanent prohibitory injunction could  

and ought  to  have raised the  question of  validity of  the  

termination of the lease as the termination of the lease had  

by that time taken place.  So also the question whether the  

transferee, who had not been recognised by the Port Trust,  

could  institute  a  suit  against  the  Port  Trust  so  as  to  

challenge  the  termination  of  the  lease  in  favour  of  his  

vendor  also  need  not  be  examined.  All  that  we  need  

mention is that the addition of the lessee as a co-plaintiff in  

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the suit also came as late as in the year 1999 when the  

original  plaintiff  transferee  of  the  lease  appears  to  have  

realised that it is difficult to assert his rights against the Port  

Trust on the basis of a transfer which was effected without  

the permission of the lessor-Port Trust.  

28. In  the  result,  we  allow  this  appeal,  set  aside  the  

impugned judgment and decree passed by the Courts below  

and dismiss the  suit  filed by the  respondents  but  in  the  

circumstances without any order as to costs.   

             ……..………….……….…..…J.         (T.S. Thakur)

     …………………………..…..…J.              (Gyan Sudha Misra)

New Delhi January 9, 2013

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